Monica Lingegård joined the state-owned Swedish rail operator SJ last year at one of the most challenging times in its 165-year history. The company, which usually carries about 31 million passengers annually, was struggling as the number of people travelling dried up amid the COVID-19 pandemic.
“We kept driving the trains, but we were only able to sell a limited amount of tickets. We were losing money,” she says. While a private company might have parked its rolling stock to cut costs until demand picked up again, SJ had a duty to consider the wellbeing of all of its stakeholders.
“We had to make sure we could still offer pleasant, safe and secure travelling, even though we had a pandemic going on,” Monica says. “A normal company that is 100% focused on making profit would have just locked down and said, ‘Call us when the pandemic is over.’ But that doesn’t go for us. Profit is important, but it’s not everything.”
Rising to that responsibility meant Monica never got to enjoy the usual settling-in period, where a CEO has the chance to get to know the ins and outs of a company before being called upon to make any major decisions. “I had to make decisions from day one because the company was in a very difficult situation. I’m happy that this is not my first CEO job,” she says.
Things were also highly challenging on the ground for employees, some of whom had to face angry travellers as stresses ran high during uncertain times. Thankfully, they are well-trained to deal with such situations.
Everything we do, we have to put the customer first, and we have to drive excellence.
“Our employees have met travellers that are different than they usually are, but they have dealt with that in the most fantastic way,” Monica says. “We have a very strong, service-oriented culture that you can depend upon. It’s human. We keep things simple and trustworthy. I think the culture has probably been our strongest tool throughout the pandemic.”
SJ employs around 5,400 people in Sweden and Norway and runs about 1,500 departures a day from 400 stations. Before joining the company, Monica was CEO of the state-owned company Samhall, which employs people with disabilities while offering training to help them find jobs in the labour market. She also serves as a board member at the Stockholm-based private care provider Humana and as chair of the board at the Swedish Space Corporation.
The upside of joining the company at such a tumultuous time, Monica says, is that she has been able to get things done far more quickly than would have been possible before. “I got the opportunity to reorganise in a way that makes us more customer-oriented and customer-focused,” she shares.
“It gave me an opportunity to reduce costs, and I didn’t even have to explain why, because it was so obvious.” Even amid all the uncertainty and financial difficulty, the long-term outlook for SJ looks overwhelmingly bright.
Demand for rail travel is trending upward overall, especially in carbon-conscious Sweden, where the flygskam, or ‘flight shame’, movement began in 2018 and where climate activist Greta Thunberg regularly makes headlines.
“The good part about being SJ is that we are looking at a strong and positive future,” Monica says. “We offer an attractive and climate-neutral travel option and are absolutely the best way to travel if you are focused on the climate crisis and trying to reduce CO2 emissions. We saw that before the pandemic, and we see that now; demand for our services is going through the roof.”
Over the next 12 months, Monica and her leadership team anticipate positive growth. The flipside of that, though, is that other rail operators are also vying for all this extra business. Monica does not feel threatened. “Being Sweden, we are the first true deregulated market,” she says.
“We have competitors, which makes us different from many other companies or countries in Europe, where the train operator market is not deregulated yet.”
“I think that’s the best thing that can happen to us because it forces us to be even more customer-focused. Everything we do, we have to put the customer first and we have to drive excellence. We have to ensure that we have higher and better productivity than any other company because customers are not willing to pay for inefficiencies or bad processes.”
One way SJ stays ahead of the competition is with heavy investment in digital services and solutions. “Our service offering is just as much about transporting people on lovely and comfortable trains as offering digital tools, applications and service platforms,” Monica says.
“We are turning more and more from being solely a train operator to being a digital company. We are at the forefront and a lot better than our competitors in Sweden.” Each of SJ’s trains is connected to an Internet of Things, helping to ensure the entire fleet runs smoothly and is cost-effective. Being connected like this enables predictive maintenance so engineers can fix issues before they become problems, which ultimately cuts down delays for passengers.
This also allows SJ to see which areas are in need of investment ahead of time, making planning easier, which is highly valuable in an industry that often plans decades ahead. The company also has a division called SJ Labs, which designs new applications and develops them with real customers to ensure the final product is as user-friendly and as relevant to passengers as possible.
“We want to innovate, and we want to try things together with our customers,” Monica says. “Many companies tend to make sure that everything is 100% correct and 100% finalised before they launch stuff. But we launch stuff before it’s fully ready, and then we develop it together with our customers.”
As part of its digital journey, SJ works with suppliers who are at the forefront of machine learning, artificial intelligence and virtual reality. The company has even offered VR training to some of its staff.
To keep these investments as cost-effective as possible, Monica plans to look for suppliers working inside Sweden or other parts of Western Europe for specific expertise and then outsource to cheaper countries such as Ukraine to do the heavy lifting of building the digital tool.
“Behind all these ideas are millions of programming hours, building all these apps,” she says. “So that’s why you need to buy hours on the market and make sure you do that in a cost-effective way.”
We want to innovate, and we want to try things together with our customers.
One of the digital changes at SJ that Monica is most excited about is the use of data analytics to ensure that customers get added value when it comes to service, support and customer satisfaction. She sees data analytics building upon the traditional priority programs that the companies have used to add value before.
“We want to invest more in data and analytics in order to secure customer service and customer support and customer offerings that go beyond priority programs, using data in a way that really adds value to the customer,” she says.
Monica adopts a people-focused approach to ensure operational excellence. SJ encourages its employees to always ask themselves where they are adding value to the customer experience, and to weed out processes and activities that do not further this goal.
We are turning more and more from being solely a train operator to being a digital company.
To help achieve that, Monica believes it is paramount for people to be given mandates so that they’re free to make decisions and show leadership on the job, close to the source of a problem, rather than having to send things up the chain of command all the time. What that looks like on the ground is emboldened staff who feel at home in their roles and confident in their abilities.
“I want to make sure we have an organisation that’s staffed with people who are brave and comfortable enough to take the necessary decisions,” Monica says.